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KO was recently trading at $44.41 and has an implied volatility of 10.79% for this period. Based on an analysis of the options available for KO expiring on 19-Jan-2018, there is a 71.21% likelihood that the underlying will close within the analyzed range of $40.90-$49.99 at expiration. In this scenario, the average linear return for the trade would be 11.09%.

Price target: Zacks Research has updated their six-month price target for KO to $45.44. This price target is a consensus price created from the price targets published by 9 participating analysts whose targets ranged from $42.00 to $50.00.

Mean recommendation: Zacks normalizes analyst recommendations to a 1-5 scale where 1 indicates a strong buy. Their mean recommendation for KO has been updated to 2.69, which indicates a hold consensus from analysts. Sentiment has moved from 2.67 to 2.67 to 2.69 over the past three months.

Trade approach: The difference between the current price for KO and the mean price target is $0.59, which represents a 2.34% move (4.80% annualized). Since the 180-day implied volatility for KO is 12.19%, a neutral range-bound strategy could prove effective if the price target ultimately turns out to be accurate.

Upside potential: Using this neutral range-bound strategy, the trade would be profitable if COCA-COLA closed in the range $40.50-$50.50 on 19-Jan-2018. Based on our analysis, there is a 75.73% likelihood of this return. The maximum return for this trade would be 11.11% if COCA-COLA closed in the range $41.00-$50.00.

Downside risk: As with any options trade, there is a substantial downside risk where you may lose most or all of your investment.